Tuesday, August 2, 2011

Why Entrepreneurs Should Never Meet VC's Unless They're Formally Pitching

A really interesting article that makes an excellent case for not meeting VC's unless formally pitching. This is certainly not the approach we've been taking but Allen's arguments make good sense.

1. What do you think? Others, including Mark Suster have made the opposite case well and not taking these meetings doesn't fit with the open approach we take to our business.

2. How would you go about politely declining a meeting with a VC in a case like this while still keeping the bridges open should you want to make a formal pitch in the future? I feel like having turned down an opportunity to speak in the past may make it harder to get a positive meeting in the future.

Image credit.

5 comments:

  1. Hi Michael,

    There is an error in the first hyperlink in the article that you might want to fix.

    Good article though. I think like everything it is a balance and perhaps if it is just an informal meeting you still need to have a polished pitch for your business ready so that you don't appear under-prepared or flippant?

    Im sure it is frequently a blend of the two approaches which is adopted!

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  2. VCs are greedy and are only looking out for themselves/their investors. You can see this most clearly in the case of successful entrepreneurs on their 2nd start-up - they rarely go the VC route. VCs like to meet with as many people as possible to get insights into what is happening in the market, and are not necessarily seriously considering investing in all (or even most) cases.

    On your second point, if the business and deal terms are promising, the past doesn't really come into play. You need to create a competitive environmen for your deal. There was a good post recently on Mixergy from a professional "pitcher".

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  3. Louisa - link fixed, thanks. Agreed that the answer is probably a balance as you suggest.

    LSP - good points, particularly around the past not being so important and the need to create a competitive environment for your deal. Blog post on that exact topic in the works. :D

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  4. Mark Suster is who I think you meant (typo)

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